Later life financial advice
Financial advice in later life can be very different to advice sought in our earlier years. When we are younger, we seek advice on life insurance, building up a pension fund or making an investment.
In later life advice could be more about using our assets efficiently to provide a retirement income, planning to mitigate an inheritance tax liability, to pass wealth efficiently down the generations or how best to pay for long term care fees.
For these reasons it makes sense to take advice from a specialist in giving financial advice in later life. Ed Midgley is our own expert in this area. Ed is an accredited member of the Society of Later Life Advisers (SOLLA) and also holds the SOLLA later life lending standard.
Ed works with clients and their families to ensure their financial needs are met at an important time in life. He will take the time to understand your needs and work with the family or attorney to form a working plan and stay with you on the journey. We operate a dedicated older client / extra care procedure which sets out how we work with clients in later life.
The levels and bases of taxation and reliefs from taxation can change at any time. The value of any tax relief depends on individual circumstances.
Care Fees Planning
Many older people in the UK live in a care home. Many do however require care in their own home and whatever type of care is needed, it does not come cheap. Ed can assist with explaining the care system and what options are available. He can also put you in touch with our Care Concierge Service, provided by Care Sourcer.
Some of the options Ed can assist with for funding care costs include:
- Using own income / savings / investments
- Care fees plans (also known as immediate needs annuities)
- Using the main residence – either renting out or releasing equity through a lifetime mortgage*
The value of an investment with St. James's Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested.
The services provided by Care Sourcer are separate and distinct to those offered by St. James's Place.
Lifetime Mortgages
Many of us sit on equity within our homes and need to access this in later life. There are many reasons for wanting access and various ways it can be achieved.
You may need to pay to adapt your home in later life, for example, a downstairs bedroom, a wet room or stairlift may be appropriate, or adjustments to the overall layout to enable moving around to be easier.
You may enter retirement still with a mortgage to pay off, or an interest only mortgage comes to an end and an alternative is needed to ensure you remain in your home.
Gifting to family members is a popular reason for accessing equity. This could simply be to benefit your family members whilst you are still alive or to provide say for a deposit for a first time buyer.
Paying for care costs can be achieved via the equity in the home – this can be done by either a lump sum or regular income payments or drawdowns as and when required.
Some of the options in later life include:
A traditional capital repayment or interest only mortgage
A retirement interest-only (RIO) mortgage
An equity release mortgage*
A home reversion plan
*To understand the features and risks associated with this type of mortgage, you must ask for a personalised illustration.
Ed will take to the time to explain all the options available and ensure the most appropriate solution is recommended.
Inheritance Tax Mitigation
According to HMRC, £5.2bn inheritance tax (IHT) was paid in the tax year 2019/20. With many reliefs frozen, this figure is set to rise further. Yet there are many ways to tackle an IHT liability, some which still give access to an asset without compromising the tax mitigation.
Ed has many years’ experience dealing in the IHT mitigation market and has worked for and with some of the big players in this field. Ed can walk you through what options are available, whether it is by using reliefs and allowances, setting up a trust, covering a liability with life assurance or making an investment which qualifies for Business Relief.
Finally, Ed will also discuss will planning and lasting powers of attorney and whilst he does not arrange these himself, he will put you in touch with the appropriate professionals should he feel this is necessary.
Got a question?
Do get in touch with us if you need a bit more information about these services, or any of our other financial planning advice.
